Herbalife LBO Imminent?

Tyler Durden's picture

A new twist in the neverending battle between Icahn and Ackman over the true value of Herbalife emerged moments ago when while reading from the criminal complaint filed against the charged former KPMG auditor Scott London, CNBC's Jane Wells cited an email from London to his "client" that "Herbalife was going to go private." Supposedly this means that Icahn is not just sitting there and twiddling his thumbs waiting for Ackman to be crushed under the weight of JCPenney, but that he, or someone else, is preparing an imminent LBO, if at least the data KPMG had until its resignation as HLF's auditor is credible.  Why, however, an auditor would know what an equity investor's plans for the company are, remains unclear.

Full Criminal complaint:

h/t @alchemy_destiny

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francis_sawyer's picture

Promote MDB to CEO ~ NOW!


He does it, 'The Company Way'!

AlaricBalth's picture

SEC Complaint: http://www.sec.gov/litigation/complaints/2013/comp-pr2013-58.pdf

1) Trading in Advance of Earnings Announcements and Releases of Financial Results for Herbalife, Skechers and Deckers

2) Trading in Advance of Merger Announcements for RSC Holdings and Pacific Capital

London received approximately $50,000 in compensation in cash, jewelry, and entertainment expenses in exchange for the information he provided...

What a dumbass. Throws away his career for $50 large and some swag!!!

AlaricBalth's picture

London's co-defendant, Bryan Shaw, made $1.27 million on the information London provided. This makes Scott London an even bigger stooge for collecting only 4-5% of the take. 

James_Cole's picture

This makes Scott London an even bigger stooge for collecting only 4-5% of the take. 

To be fair he got mysterious 'other benefits' - cocaine ain't cheap!

Shaw paid London $50,000 in cash and provided him with jewelry, meals and tickets to entertainment events, as well as other benefits.  

redpill's picture

Rest In Pieces Ackman, you've been iCahned

AlaricBalth's picture

To be fair he got mysterious 'other benefits' - cocaine ain't cheap!

And that is exactly what he will claim (if he has a good attorney) at his sentencing hearing to receive time off (up to one year) via the RDAP program in federal prison. It could help him tremendously to get a cocaine problem on the record during his PSI report.

HoaX's picture

You can already pretty much figure out what he will claim by reading the SEC complaint you linked to mate:

Page 18, Scott London´s April 9 statement; "These leaks started out a few years back in an effort to help out someone whose business was struggling"

Sofa King's picture

Was it blow or did he get blown?

We'll never know...

hedgeless_horseman's picture



I only wish they were fighting over a real company.

Divided States of America's picture

ACKMAN vs ICAHN, ZELL & GROSS vs BERNANKE....man lovin' all this action today, better than UFC, its JEW F C

Bearwagon's picture

Calm down ... it will do you no harm.

nugjuice's picture

I'll have you know I logged in on a tablet (annoying) with a shitty hotel bar internet connection just to up vote/comment this.

Not BC I have a problem with Jews... just BC what you said was hella clever. Bravo

nugjuice's picture

I'll have you know I logged in on a tablet (annoying) with a shitty hotel bar internet connection just to up vote/comment this.

Not BC I have a problem with Jews... just BC what you said was hella clever. Bravo

Buck Johnson's picture

I think the reason why they are thinking about taking Herbalife private is because that way they can hide a little longer the ponzi scheme that the company truly is.  If I was class action lawyers I would be putting cases against Herbalife right now.

China Reporter's picture

Never expect the battle over HLF is going to end that soon


kaa1016's picture

I bought the 40 calls that expire tomorrow the second she said that. I don't think they realize how much they just fucked Ackman. Actually, after what was said this morning, I think that was the whole point.

kaa1016's picture

That was sick. Got to love explosions in implied vol the day before expiration. In and out of those calls.

timbo_em's picture

I'm sorry you had to watch CNBC!

Good luck with your trade, though!

catacl1sm's picture

Can't lever a company to the tits, claim it as profit, collect bonuses nad massive pay increases and leave the shareholders holding the bag when it goes tits up as a private company. This doesn't fit the American model of 'wealth' creation.

LawsofPhysics's picture

But that is what all the banks do.  I'm confused.

Dr. Engali's picture

I'd love to have seen Ackman's little metro-sexual crying face when he got this piece of news.

smlbizman's picture

here , take a pin....one chance is your fucked...another chance you have is, you're royally fucked,  another is you got fucked and i got aids...

hannah's picture

Icahn isnt involved in a lbo. he never has his money in the game. he buys a min share to look like he is doing something. most of the time it is calls/puts. he has 'pennies' in the game. this is all media bs to pump and dump...

Colonel Klink's picture

iCON is a cock!  Albeit a cut one.

Downtoolong's picture

Yep, nobody talks his book like the Ichan can (or the I can con, whatever). And just about the time people think they are joining him, they find out he is on the other side of their trade. 

adr's picture

So how does a company that has no real quantifiable sales, other than "sold" product sitting on shelves in "distributor's" garages, going to go private?

I mean without stock options how is anyone on the Herballife board going to buy million dollar homes in LA, or yachts, of Tesla cars? How do they afford the small city they occupy in Torrance?

Do they honestly think they can sell the quanity of product needed to generate the same dollar value as a stock that shoots up 75%?

Of course if Herbalife does go private, then there will be nothing left to cover up the ponzi pyramid the company runs on. Of course a private MLM company is a ponzi, but a public one is called a succesful corporation.

HLF almost makes Bitcoin look like a no fail investment.

slaughterer's picture

Weird how Ackman has become the pin-up fall-guy for what everybody hates about hedge funds, whereas it really should be Icahn.  Icahn is pure evil.    

Divided States of America's picture

Yeah its the likes of Icahn that breeded the likes of Ackman, he is def one of the founding grandpa of the evil empire.

slaughterer's picture

Icahn was the model for Gordon Gekko, but what I am saying is, isn't Ackman right, wouldn't the average ZHer agree with the Ackman thesis that HLF is a ponzi pyramid scheme?  and isn't icahn the risky investor publicly endorsing a fraudulent company?  

Divided States of America's picture

I agree, I think Ackman has a point but what do I know...I have been shorting the markets so long that the only shorts that I own that are left are in my drawer...and summer doesnt seem to be coming anytime soon.

gmrpeabody's picture

You owe me a new keyboard..., ahole.  ;)

Bearwagon's picture

It's called a spin. You know what I'm talking about?

otto skorzeny's picture

bigger scam-shitcoin or herbalie?

dime2962's picture

The dealer just got his face ripped off. With no intel on why. 

slaughterer's picture

Meanwhile, Gundlach suggests SHORT CMG, taking a cue from the Einhorn playbook.  "Gourmet burritos is an oxymoron."

Bearwagon's picture

Did Einhorn notice the fine difference between "gourmet" and "gourmand"?

Shaten's picture

so in order to go private herbalife accepts bitcoins and issues debt in bitcoins.

azzhatter's picture

Can't decide who I hate more Ackman or Icahn? Isn't there some way they both can get fucked?

WTFUD's picture

London. . . probably Shaw are the little fall guys. KPMG=JPM=BLACKSTONE=MOODYS=HFT=CONgress=GOLDMAN=FED=
Revolving Door of Ponzi laundering henchmen hack whores.

ttown's picture

LOL at this Herbalife Ponzi scheme fraud. Now reports coming out that they were cooking the books and insider trading? Now the company generates romurs of going private in a desperate attempt to help their share price? Is it too late that the SEC is on too you illegal pyramid scheme scam with fake product sales and false reporting?  Exposing the $ HLF fraud for what it is... http://factsaboutherbalife.com/

Quantum Nucleonics's picture

Wow, don't f$ck with Carl, ever!

ttown's picture

whatever dude, carl is getting owned in this position. buying stake in a fraud pyrmaid scheme company that FTC and SEC is investigating? Poor Carl desperately trying to jump ship before the other insiders?

ttown's picture

"$HLF may cease to exist, FACT: "Belgium court ordered Herbalife to end its sales in Belgium." due to pyramid scheme. http://stks.co/jRCK"

Papasmurf's picture

Let the dick measuring contest begin.